Virtualization is good in e.g. cloud scenarios where the usage is spread out to different machines through out the day. Rather than have 10 machines averaging 5% utilization at all times you can have 1 machine with e.g. 60% utilization all the time. A win.

Sadly, pointy-haired bosses have started putting developers on VMs which is exactly the opposite use case: all people loading their machines at roughly the same time (e.g. I've heard people claim that in Java 1/3rd of time is spent compiling. If you have more then 3 devs....). A fail.